WHAT THE DOING TAUGHT ME

Lessons I paid for and what I did with them

Bruce Eickelman

Drawn from The Return to Grown-Up Capitalism, forthcoming

In the late 1990s I had an idea.

Service stations across Australia had petrol pumps with nothing on top of them. Dead space. I figured I could rent that space from the owners, mount advertising frames, sell the advertising, and build a business on the margin between the two. I went around to service station owners making the pitch. I got a few funny looks. I secured about eighty stations, mounted the frames, sold the ads.

For about eighteen months it worked. Then the national chain I had been targeting — the big one, the one that would have made the whole thing scale — decided they could bring it in-house and cut me out. Which they did.

I woke up one morning with approximately ten thousand dollars worth of click frames in my garage and no income.

My business partner was stunned and at a loss. I had a wife, two babies, a mortgage, and no options I could see except one: find someone who wanted the frames.

I spent the following week on the phone. Within seven days every frame was sold.

I have thought about that week a lot over the years. Not with pride exactly — it was not a heroic act, it was just the only available move. But what I understood later was why it happened the way it did. The consequence of not solving the problem landed directly on me. On my family. On the next mortgage payment. There was no buffer between the decision and the cost. So I moved.

That is not a lesson about resilience or positive thinking. It is a lesson about consequence. When it lands close, it clarifies. When it is absorbed somewhere else — by a partner, an institution, a safety net — the urgency that produces action quietly disappears.

Before I set up my mortgage broking company I spent eighteen months working in the industry first.

This was not an accident. It came from watching a man I knew in the mid-1980s in the United States. He was planning to open a bed and breakfast in the northeast. Before he signed a lease or spent a dollar, he got a job at a Holiday Inn. He became their best employee. He learned the operation from the inside — the bookings, the complaints, the staff, the margins, the things that go wrong at two in the morning that nobody tells you about when you are sitting across from a real estate agent talking about passive income.

He was getting paid for his education.

I remembered that when I decided to get into financial services. I was not a finance person. I had never thought of myself as one. But I spent eighteen months inside the industry before I opened my own shop — learning the products, the compliance, the client relationships, the margins. Getting paid while I learned what I needed to know.

In 2003 I opened Secure Financial. By 2006 I was earning over twenty thousand dollars a month in trailing income. It was the most financially successful business I had built to that point.

Then the GFC arrived.

I want to be careful about how I describe what happened next, because there is a version of this story that sounds like an excuse and a version that is just accurate.

The accurate version is this: I had done the work, built the structure, run the numbers. The business was sound. What was not sound was the global lending system that the business depended on — and when that system collapsed in 2008 and into 2009, it took with it a large number of businesses that had done nothing wrong except exist inside the same system.

That is not a comfortable thing to say because it sounds like blame. But there is a distinction the book I am writing tries to make clearly: some failures are yours and some failures are the system’s. Knowing which is which matters. Pretending they are always the same thing — that every failure is a personal failure of discipline or preparation — is as dishonest as pretending they are never your fault.

The mortgage business was the system’s failure. I had run the sharp pencil over my own numbers. I had not — and could not have — run it over a global lending system that turned out to be built on foundations nobody was admitting were rotten.

The frames in the garage were my problem to solve. The GFC was not.

Both cost me. Only one of them was mine to own.

New Year’s Eve, 1979. I opened the doors of Sundancers.

It was so cold that night that when we closed at four in the morning, every car in the lot was frozen solid. Wind chill of minus eighty Fahrenheit. People could not get home.

So I opened the kitchen and served breakfast.

That decision — which took about thirty seconds to make — became the talk of the town. And the talk of the town was worth more than any advertising I could have bought. The business did well for several years. The house band was a man who had played at my parents’ club in the sixties. There was a continuity to it that felt right.

By 1983 business had slowed. We converted to a dinner restaurant with bands on weekends only. That bought a few more years.

And then, in or around 1985, I missed the exit window.

A new club opened down the road and became the next hot spot. The momentum shifted. I could see it happening. What I could not do — or did not do — was act on what I could see while there was still time to sell at a price that reflected what the business had been rather than what it was becoming.

Nobody had ever told me about exit windows. Nobody had sat me down early in the piece and said: this thing you are building will have a moment when it is worth the most it will ever be worth, and that moment will pass, and if you are not ready to move when it arrives you will spend the next several years selling something that is declining rather than something that is at its peak.

I sold in 1986. We covered the debt. I started another chapter.

The lesson was not that the nightclub failed. It did not fail — it ran for seven years and paid its way. The lesson was that building something and knowing how to exit it are two completely different skills, and most people who are good at the first one never develop the second until it costs them.

I have watched that pattern repeat in businesses of every size and type in the decades since. The builder who cannot sell. The founder who cannot let go. The operator who mistakes the thing they built for the thing they are. The magazine publisher who locked the doors last year rather than sell for less than his decades of work felt worth.

The exit window does not stay open. That is the one thing I would go back and tell my 1983 self if I could.

People who know me would say I am a confident person. They would not be wrong.

What they might not know is where it came from.

My mother was an optimist about my abilities from the beginning. She saw something in me that I did not always see in myself — what she called the gift of the gab, a willingness to back myself, an appetite for calculated risk. She funded my first business when I needed a start. I paid back every dollar. But it would not have happened without her belief coming first.

I have always carried the line: if you think you can, you can. If you think you can’t, well, you can’t. I cannot tell you I arrived at that myself. It came from her.

What I can tell you is that the confidence was real and it built real things. The pump-top frames, the nightclub, the sub shops, the mortgage business, the pizza shop at 67. None of those happen without the willingness to back yourself past the point where most people stop.

But confidence without structure has a cost that is not always visible until later.

I was young enough, for a long time, to absorb that cost. I told myself: if I fail I have plenty of start-overs inside me. That was true. It was also, looking back, a way of not running the sharp pencil over the decision in front of me as clearly as I should have. The confidence that kept me moving sometimes kept me from stopping long enough to ask the questions that needed asking.

My brother Steve never asked for help to start a business. He worked as a guard at a prison in Joliet, Illinois. He fished on weekends. As far as I can see he enjoyed his life.

I am not saying his way was better or worse than mine. I am saying it was a different calculation — one with fewer start-overs required.

There is no universal answer to how much risk is the right amount. What I know is that the risk is easier to carry when you have run the numbers clearly, when you have learned the industry before you have invested in it, when you have thought about the exit before you have committed to the entrance.

The confidence your mother gives you is a gift. The sharp pencil is what you give yourself.

I am 72 years old and I have been in more rooms than I can count where something was about to go wrong and nobody was saying it.

Sometimes I was the one not saying it.

What the doing taught me — across the frames and the nightclub and the mortgage business and the pizza shop and everything in between — is that the gap between capability and outcome is almost always structural. It is not about how smart you are or how hard you work or how much you believe in yourself.

It is about whether consequence is landing close enough to teach you. Whether the numbers have been run with a clear mind. Whether someone in the room is willing to ask the question that makes everyone uncomfortable.

That is the work I do with the people I work with now. Not because I got everything right. Because I got enough things wrong, at enough cost, to know what the questions are.

The Return to Grown-Up Capitalism by Bruce Eickelman is forthcoming. For information about 12X Decision Architecture, visit 12xclarity.com.